Ryerson Not Insured For $8.5M Fraud Settlement: 7th Circ.

Law360, New York (April 12, 2012, 9:05 PM EDT) -- The Seventh Circuit on Thursday upheld an Illinois federal judge's ruling that Federal Insurance Co. isn't obligated to cover Ryerson Inc.'s $8.5 million settlement of a lawsuit claiming a Ryerson predecessor fraudulently misled EMC Group Inc. into overpaying for a group of its subsidiaries and violated their sale agreement.

The liability policy Ryerson — a Chicago metals company — bought from Federal doesn't cover claims for restitution of property that rightfully belongs to someone else, like the $8.5 million EMC allegedly overpaid for the companies, a...